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City, Developers Looking to Replace Walmart in Ward 7

By Leanna Commins/Howard University News Service
On February 1, 2016

City leaders, developers scramble to find big box retailer replacement.

WASHINGTON -- City officials and the Skyland Town Center developer told frustrated Southeast residents Thursday they will continue to search for a retailer to replace Walmart after the company announced it will not be building a store in Ward 7.

Gary Rappaport, CEO of Rappaport Companies, the development company handling the Skyland Town Center, told residents during an Advisory Neighborhood Commission meeting that his company has been talking with other big box retailers, but he was unwilling to discuss which companies.

“There’s not a retailer that is in Washington, D.C., or ever wants to be in Washington, D.C., that doesn’t know about Skyland, because we’ve been working on this project for 15 years,” Rappaport said. “It’s not going to happen in a couple of weeks, but at least everyone knows the project.”

Rappaport said his company does have a signed lease with Walmart as of December 2014, but said it can’t force Walmart to open.

“You could look at the liabilities, and we can go down that road, with the District’s help, but at the same time, we can’t wait,” he said.  “So, what we do is we list every kind of retail tenant that could possibly fit in this space. We have put together that list and we have started calling that list.”

The city and developers learned Jan. 15 that Walmart was pulling out of a project to build two superstores in Ward 7 east of the Anacostia River, citing disappointing performances at the three stores it has opened in the District since 2013.

The other store was to be built at Capitol Gateway Marketplace on East Capitol Street in northeast Washington, another property owned and managed by Rappaport.

The Skyland Town Center is a property that was sold to Rappaport in Dec. 2014, a decade after the city seized the property. Sitting on the intersection of Good Hope Road, Naylor Road and Alabama Avenue in southeast Washington, the 18.5 acres of land is to be home to 340,000 square feet of retail space and 480 residential units.

The retail space was to be anchored by Walmart. As of early December, Skyland Town Center was still under construction.

Rappaport said Walmart’s decision has made it unclear whether construction for the Skyland property will continue. CVS will be moving into the temporary trailers in the parking lot of the property in the first week of February. They will continue to operate until Skyland is built.

“I can’t answer anything else after four or five days other than we are out there as fast we can, trying to build our anchor tenants again,” Rappaport said. “We were under construction and we’re actually as of today still under construction. But we can’t continue to build unless we have some interest [from retailers] at some point.”

Deputy Mayor Brian T. Kenner told residents city officials were as disappointed as they were.

“To say that it’s disappointing, not only in terms of us getting Skyland shopping center to a point where we all felt it was ready to move forward, disappointment does not describe the perspective,” Kenner said.

Councilmember Yvette Alexander of Ward 7 tried to assure residents, the city is working with Rappaport to finish the Skyland Town Center project.

“What we can do on the council and working with the executive [office] is to offer whatever incentives that we can for any retailers that are interested in coming,” Alexander said, “and that’s something that I definitely want to do and that’s something that the mayor is willing to do at this point, because we have to get these projects done.

“So, I just want to say it’s not over. We’re definitely committed to getting it done and it will get done.”

Despite Alexander’s reassurances, some residents were frustrated that the city never had a written contract with Walmart that required it to build in Southeast. Kenner said the city had what he described as a “pledge” from Walmart to build in neighborhoods throughout the city, but no official contract.

Tiffany Brown, an Advisory Neighborhood Commissioner for Ward 7, said that many residents were under the impression that there was a signed agreement between Walmart and the District.

“I just wonder who does business like that,” Brown said. “[The District is] dealing with people’s lives and livelihoods. There’s no place to shop. There’s no place to work. There’s no place to eat. There’s no place to live.”

Residents also express concern that while the city and developer attempts to find a new retail tenant, the Skyland Town Center property will become troublesome for those who live near it.

“When I look at other construction sites in other places, when there is a hole, immediately [developers] will put up walls,” Brown said.

Gary Butler, another Advisory Neighborhood Commissioner, said he thinks the city should start the Skyland Town Center project over in its entirety after 15 years of development.

“We really need to stop dealing with big developers and start trying to nurture some of small midsize developers that actually serve the city,” Butler said.

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